The iPad 2 is also 1/3 thinner and slightly lighter than the previous model, but has the same battery life, Apple CEO Steve Jobs said while demonstrating the device. It will include an upgraded version of Apple’s mobile OS, iOS 4.3, which will improve web browsing performance and add more support for AirPlay, a tool for streaming audio and video between compatible devices.

““We think 2011 is clearly going to be the year of iPad 2,” said Jobs.

The iPad will be available for purchase March 11, will come in two colors (black and white) and will have the same price as the current model, starting at $500 for a Wi-Fi only model with 16GB of storage. It will also be available with 3G wireless support from either AT&T or Verizon Wireless.

Apple has sold more than 15 million iPads since its debut, according to Jobs, including more than 7 million in the last quarter of 2010. Recently, competitors have introduced tablet devices based on Android and WebOS that include more memory, more processing power, and cameras (the iPad has none), although sales of competing tablets have yet to take off.

The upgrades address many of the criticisms leveled at the first-generation iPad, particularly its lack of cameras for video recording and web conferencing.

The company also demonstrated two iPad apps that it will begin selling March 11, GarageBand and iMovie. Both look to be fairly sophisticated tablet-optimized versions of similar software that Apple already sells for Mac OS X users, and will sell for $5 in the App Store.

“This is no toy,” said Jobs of the iPad GarageBand. “This is something you can use for real work.”

Since the two apps are meant for creative content creation, they may help forestall criticism that the iPad is primarily a content consumption device, ideal for reading, web browsing and watching video, but not necessarily for creating.

For the full blow-by-blow of the event, in reverse chronological order, see below.

Live Blog

11:19 a.m. We’re wrapping up. Hands-on time! Stay tuned.

11:16 a.m. Steve: “It’s in Apple’s DNA that technology alone is not enough. That it’s technology married with liberal arts, married with the humanities, that yields us with the results” He says a lot of competitors are looking at tablets like PCs, just emphasizing parts and speeds. Steve says these are post-PCs, and they have to be seamless and user friendly. “I think we stand a pretty good chance to be pretty competitive in this market.”

11:10 a.m. Steve summarizing the iPad 2: Faster, lighter, thinner, cameras and gyro, iOS 4.3. Same prices as previous as iPad, starting at $500. “We think 2011 is clearly going to be the year of iPad 2,” says Steve. Showing a video now of Apple staff going over all the features.

11:09 a.m. Steve is back on stage. “I’m blown away with this stuff. You know, playing your own instruments or using the smart instruments, anyone can make music now, with something that’s this thick and weighs 1.3 pounds. It’s unbelievable.”
“This is no toy,” he adds. “This is something you can use for real work. I can’t tell you how many hours teenagers are going to spend making music with this.” $5 on the App Store.

11:05 a.m. GarageBand supports up to 8 tracks of recordings. All changes are autosaved. When you’re done you can tap on export and send to iTunes or e-mail the song.

Apple will release GarageBand as an iPad 2 app in March.

11:02 a.m. There are also “smart apps” for different instruments. SmartGuitar, SmartBass, SmartDrums, etc. They make it so anybody can play with no knowledge of the instruments. In SmartGuitar, the chords are all pre-defined, so they all sound right when you play them.

11:01 a.m. GarageBand also has some virtual drums so you can just tap on a bunch of them in the iPad. Looks fun.

10:59 a.m. Showing a synthesizer inside GarageBand. You can play it like a virtual keyboard, change the instruments and effects. Sounds pretty good.

10:56 a.m. Another app that will ship for iPad is GarageBand. Xander Soren, director of music marketing, coming on stage.

10:54 a.m. Steve is back on stage: “It’s awesome. 1.3 pounds. It blows my mind.” The iMovie app is going to be $5 on the App Store on March 11.

10:53 a.m. With iMovie you can hit AirPlay to play directly to Apple TV, or you can just play the movie on the iPad. Showing a demo video of a home documentary shot with it.

10:50 a.m. iMovie for iPad works mostly the same as it does for iPhone. Drag your fingers around clips to scrub through them, tap around to apply edits or make cuts, etc.

10:47 a.m. Steve is back on stage, and there are two new apps for iPad. First, iMovie for iPad, video-editing software. Randy Ubillos,chief architect of video applications, is giving a demo.

10:44 a.m. Now you can also videoconference on the iPad 2 with FaceTime. Showing a demo. Buddy list pops up on the right, you can call someone right away. “The size of the iPad is just ideal for videoconferencing,” says Scott. You can also flip to the rear camera to show what you’re looking at.

10:42 a.m. Scott’s demonstrating taking a picture of himself with the Photo Booth app using the front-facing camera. There are a bunch of effects you can apply.

10:40 a.m. AirPlay will let you stream your iPad videos right to an Apple TV. Now apps from the App Store and websites can AirPlay video in addition to audio (previously it only did audio).

10:38 a.m. Now moving on to iOS 4.3. Scott Forstall, senior VP of iOS software, is on stage. iOS 4.3 is going to be released with the iPad 2. Significantly increased Safari performance with the Nitro JavaScript engine. iOS now runs JavaScript twice as fast as before.

10:35 a.m. The iPad “smart cover” comes in polyurethane, “which is used to make spacesuits,” or leather. He shows a video of how to use the case.

Apple's new iPad 2 cover bends and folds around to prop the tablet up as a typing stand.

10:34 a.m. Apple has created a cover to cover the glass of the iPad 2. It bends and folds around to prop it up as a typing stand. It wakes up the iPad from sleep when you open it. Magnets grasp and auto-align it. It adds minimal weight and thickness, and micro-fiber lining cleans the screen.

10:32 a.m. The iPad will have HDMI mirrored video output. Up to 1080p. Anything you see on an iPad screen you see on HDMI. Works with all apps, supports rotation, no setup or configuration, and you can even charge your iPad while plugged into an HDMI gadget. The HDMI accessory will cost $40.

10:30 a.m. iPad 2 shipping March 11. “This thing’s going to be everywhere in the month of March.”

10:29 a.m. Same pricing: $500 for the 16GB Wi-Fi iPad, $630 for the 16GB iPad with 3G. Steve: “We think 2011 is going to be the year of the iPad 2.”

10:28 a.m. Steve says the engineering team found a way to retain the battery life despite the boost in speed and “extra stuff.” Same 10-hour battery life and over one month of standby.

10:27 a.m. In addition to thicker it’s lighter. iPad 2 weighs 1.3 pounds, versus 1.5 pounds in the previous generation. It will be shipping in both black and white. It will support both AT&T and Verizon.

10:26 a.m. The iPad 2 is 33% thinner than the previous one. He shows a slide; it does look a lot slimmer. The iPad is 8.8 mm, and it’s actually even thinner than the iPhone 4.

10:25 a.m. A rear camera out the back and a front-facing camera on front. There’s also the gyroscope sensor, just like the iPhone and iPod Touch.

Apple's new iPad 2 is 1/3 thinner than the old model, weighs less, and comes in black and white. Photo: Jon Snyder/Wired.com

10:24 a.m. It is an all new design, not a marginal improvement, says Steve. It’s “dramatically faster” — the A5 processor. Dual-core processors, two processors inside, up to 2x faster CPU. Up to 9x faster graphics. Same low power consumption as A4, and first dual-core tablet to ship in volume.

10:23 a.m. Steve: 2011, everybody’s got a tablet. “Is 2011 going to be a year of the copycats?” He says most of the tablets aren’t even catching up with the first iPad. Introducing today iPad 2.

10:20 a.m. The video shows people in different business sectors talking about the implications of the iPad. How it will change medicine, doing business and more.

10:17 a.m. Hundreds of Apple Stores now. Apple has made a video of 2010, the year of the iPad. Showing it now.

10:14 a.m. Steve’s talking about the Samsung’s Galaxy Tab and its low sales numbers. App Store has 350,000 apps in it, and over 65,000 of those now take full advantage of the iPad.

10:13 a.m. Steve is bragging about the iPad’s price and how competitors can’t match it. “2010 turned out to be the year of the iPad.” 15 million iPads sold in 2010 — that’s just nine months. That’s more than every tablet PC ever sold. Says the tablet PC “crashed and burned.” iPad generated $9.5 billion in revenue for Apple.

10:12 a.m. Steve is going over the chronology of mobile devices. iPod in 2001, iPhone in 2007, iPad in 2010. “Every one of these has been a blockbuster,” he says.

10:11 a.m. Developers have earned over $2 billion from selling their apps on the App Store, according to Steve. Also, Apple recently shipped 100 millionth iPhone.

10:10 a.m. Apple has crossed 200 million accounts on iTunes, with credit cards and 1-click purchasing. That’s a lot of iTunes customers.

10:09 a.m. Steve is going over iBooks. Launched less than a year ago, and it’s hit a milestone of 100 million books downloaded. Random House is bringing their 17,000 books to the iBooks store along with the other big ones.